International Flavors & Fragrances Inc. (NYSE:IFF) (Euronext Paris:IFF)
and Frutarom (TASE:FRUT) (LSE:FRUTq) today announced that they have
entered into a definitive agreement under which IFF will acquire
Frutarom in a cash and stock transaction valued at approximately $7.1
billion, including the assumption of Frutarom’s net debt. Under the
terms of the agreement, which has been unanimously approved by the
Boards of Directors of both companies, Frutarom’s shareholders will
receive for each Frutarom share $71.19 in cash and 0.249 of a share of
IFF common stock, which, based on the 10-day volume weighted average
price (VWAP) for IFF’s common stock for the period ending May 4, 2018,
represents a total value of $106.25 per share.

By combining with Frutarom, IFF is accelerating its Vision 2020 strategy
to create a global leader in taste, scent and nutrition. The combination
unites two industry-leading, innovative companies with complementary
customers, capabilities and geographic reach, resulting in more exposure
to fast growing end markets and an enhanced platform to deliver
sustainable, profitable growth. The combined company’s customers will
have access to comprehensive and differentiated integrated solutions
with increased focus on naturals and health and wellness.

“This transaction is a big win and a fantastic outcome for shareholders,
customers and employees of both companies,” said IFF Chairman and CEO,
Andreas Fibig. “Frutarom has an extremely attractive product portfolio,
including broad expertise in naturals and diverse adjacencies with
capabilities beyond our core taste and scent businesses. It also has
significant exposure to complementary and fast-growing small- and
mid-sized customers. By combining our deep R&D expertise with
Frutarom’s, we are offering our customers a broader range of solutions
and accelerating our growth strategy. We believe this combination will
lead to faster and more profitable growth, enhanced free cash flow and
generate greater returns for our shareholders.”

Mr. Fibig added, “We have long admired Frutarom and have a great deal of
respect for its team and all of its dedicated and talented employees
around the globe. We look forward to welcoming Frutarom to the IFF
family.”

Ori Yehudai, President and CEO of Frutarom remarked, “Frutarom has had a
fascinating journey of accelerated growth, far above our industry
benchmarks through our investment in unique technologies and focus on
natural products in the growing world of health and taste.”

Mr. Yehudai continued, “Today, we are extremely excited to combine
Frutarom with IFF and together create global leadership in natural
taste, scent and nutrition. The growth potential for the combined
company is substantial and our shareholders will continue to enjoy this
upside.

“Today marks the culmination of a decades-long vision to become a global
leader in taste and health. This combination provides great
opportunities for both our dedicated employees and highly valued
customers who will enjoy our combined technologies and global reach
while maximizing value for our shareholders. Frutarom and IFF are
committed to maintaining a presence in Israel, and I look forward to
working with Andreas and the team to ensure a seamless integration of
these two terrific companies. I would like to personally thank Dr. John
Farber, our Chairman, for his vision and tireless support together with
the contribution of our devoted excellent employees in the
transformation of Frutarom from a small, local company to a global
leader in the fields of taste and health.”

“This transaction represents a major milestone for Frutarom and opens
the door to a new chapter of growth and shareholder value creation,”
said John Farber, Frutarom Chairman of the Board and Chairman of ICC
Industries Inc., Frutarom’s largest shareholder. “I am pleased to
support this historic combination of two world-class companies and look
forward to the next chapter of the IFF and Frutarom story.”

Frutarom is a flavors, savory solutions and natural ingredients company,
with production and development centers on six continents. It markets
and sells over 70,000 products to more than 30,000 customers in over 150
countries. Frutarom is primarily focused on natural products, which
drive more than 75% of its sales. Frutarom’s product portfolio consists
of innovative and integrated solutions combining taste and health,
natural and clean label products. In addition, Frutarom mainly serves
local and mid-size customers, and has a compelling presence in
fast-growing adjacent and complementary categories such as natural
colors, health and beauty ingredients, natural food protection and
enzymes. Frutarom has a strong track record of growth, with expected
sales of above $1.6 billion in 2018, and their previously announced
target of $2.25 billion in sales by 2020.

Compelling Strategic Rationale

Establishes Industry Leadership in Naturals: The transaction
creates a global leader in natural taste, scent and nutrition, as 75%
of Frutarom’s sales are natural.

Creates Differentiated Portfolio and Enhances Capabilities: In
addition to IFF’s and Frutarom’s highly complementary flavor
capabilities, Frutarom’s portfolio creates opportunities to expand
into attractive and fast-growing categories, such as natural colors,
enzymes, antioxidants and health ingredients. The combined company’s
customers will have access to a comprehensive portfolio with more
integrated solutions.

Broadens Complementary and Growing Customer Base: Frutarom
significantly enhances IFF’s exposure to the fast-growing small- and
mid-sized customers, including private label. Approximately 70% of
Frutarom’s sales are to these two customer groups.

Driving Enhanced Financial Performance

Accelerates Profitable Growth: On a pro forma basis, the
combined company would be expected to have approximately $5.3 billion
of revenue in 2018. Following the completion of the transaction, IFF
is expected to benefit from enhanced top line growth rates and a
strong EBITDA margin.

Provides Significant Synergy Potential: IFF and Frutarom expect
to realize approximately $145 million of run-rate cost synergies by
the third full year after closing, with approximately 25% achieved in
the first full year. Synergies are expected to come from procurement,
footprint optimization and streamlining overhead expenses. In
addition, cross-selling opportunities and integrated solutions are
expected to provide revenue synergies, creating further value to
shareholders over time.

Drives Strong Earnings and Cash Flow Accretion: The transaction
is expected to be neutral to adjusted cash earnings per share in the
first full year and double-digit accretive to adjusted cash earnings
per share in the second full year. The combined company is also
expected to generate enhanced cash flow to meet operating, financing
and strategic needs.

Following the close of the transaction, Ori Yehudai, President and CEO
of Frutarom, will serve as a strategic advisor supporting Andreas Fibig,
Chairman and Chief Executive Officer of IFF. IFF will remain
headquartered in New York City and will maintain a presence in Israel.
IFF’s stock at closing will be listed on the New York Stock Exchange
(NYSE) and the Tel Aviv Stock Exchange (TASE).

Additional Terms, Financing and Approvals

The purchase price represents a 13% premium to Frutarom’s 30-day VWAP
for the period ended May 6, 2018, and an 11% premium based on the
closing price on May 6, 2018, at current exchange rates. The transaction
is valued at approximately $7.1 billion, including the assumption of
Frutarom’s net debt, and reflects a multiple of Frutarom’s expected 2018
EBITDA of 20.3x, and 14.3x expected 2018 EBITDA inclusive of full
run-rate cost synergies.

Frutarom shareholders will also receive a special dividend, on a per
share basis, equal to 0.249 of the per share value of IFF dividends with
a record date after the date hereof and prior to the closing.

IFF intends to finance the cash portion of the transaction consideration
through a combination of existing cash on hand, new debt raised and
approximately $2.2 billion in new equity. IFF has secured committed
bridge financing from Morgan Stanley Senior Funding Inc. The transaction
is not subject to a financing condition.

While IFF’s pro forma net debt to adjusted EBITDA ratio at the close of
the transaction is expected to be approximately 3.7x, IFF is committed
to maintaining an investment grade credit rating and will prioritize
deleveraging through its anticipated strong cash flow generation. IFF
expects to deleverage to 3.0x net debt to adjusted EBITDA or lower
within 18-24 months after closing. To support this goal, IFF plans to
suspend share repurchases until the target is met.

The transaction is expected to close in six to nine months and is
subject to approval by Frutarom shareholders, clearance by the relevant
regulatory authorities and other customary closing conditions.

IFF has entered into a voting agreement with affiliates of ICC
Industries Inc., which hold in total approximately 36% of Frutarom’s
outstanding shares, pursuant to which they will vote their Frutarom
shares in favor of the transaction.

IFF First Quarter 2018 Earnings Results

In a separate press release issued today, IFF announced its First
Quarter 2018 financial results. To access the earnings release, please
visit here.

IFF and Frutarom will hold a conference call for analysts, investors and
media representatives today at 8:00 am EST (3:00 pm IDT). The press
release and the presentation can be downloaded on ir.iff.com. Investors
may access the webcast and accompanying slide presentation on IFF’s IR
website at ir.iff.com. Individuals who wish to dial into the conference
call may do so at (866) 610-1072 and enter the conference ID 1788618.
International callers should dial (973) 935-2840 and enter the
conference ID 1788618. For those unable to listen to the live webcast, a
recorded version will be made available on IFF’s website approximately
one hour after the event and will remain available on IFF’s website for
one year.

Meet IFF

International Flavors & Fragrances Inc. (NYSE:IFF) (Euronext Paris: IFF)
is a leading innovator of sensorial experiences that move the world. At
the heart of our company, we are fueled by a sense of discovery,
constantly asking “what if?”. That passion for exploration drives us to
co-create unique products that consumers taste, smell, or feel in fine
fragrances and beauty, detergents and household goods, as well as
beloved foods and beverages. Our 7,300 team members globally take
advantage of leading consumer insights, research and development,
creative expertise, and customer intimacy to develop differentiated
offerings for consumer products. Learn more at www.iff.com,
Twitter, Facebook, Instagram, and LinkedIn.

Meet Frutarom

Frutarom (LSE:FRUTq) (TASE:FRUT) is a leading global company operating
in the global flavors and natural fine ingredients markets. Frutarom has
significant production and development centers on six continents and
markets and sells over 70,000 products to more than 30,000 customers in
over 150 countries. Frutarom’s products are intended mainly for the food
and beverages, flavor and fragrance extracts, pharmaceutical,
nutraceutical, health food, functional food, food additives and
cosmetics industries.

Cautionary Statement Regarding Forward Looking Statements

This press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. All
statements regarding IFF’s or Frutarom’s expected future financial
position, results of operations, cash flows, financing plans, business
strategy, budgets, capital expenditures, competitive positions, growth
opportunities, plans and objectives of management and statements
containing the words such as “anticipate,” “approximate,” “believe,”
“plan,” “estimate,” “expect,” “project,” “could,” “should,” “will,”
“intend,” “may” and other similar expressions, are forward-looking
statements. Statements in this communication concerning IFF’s or
Frutarom’s business outlook or future economic performance, anticipated
profitability, revenues, expenses or other financial items, and product
or services line growth, together with other statements that are not
historical facts, are forward-looking statements that are estimates
reflecting management’s best judgment based upon currently available
information. Such forward-looking statements are inherently uncertain,
and stockholders and other potential investors must recognize that
actual results may differ materially from expectations as a result of a
variety of factors, including, without limitation, those discussed
below. Such forward-looking statements are based upon management’s
current expectations and include known and unknown risks, uncertainties
and other factors, many of which IFF and Frutarom are unable to predict
or control, that may cause IFF’s or Frutarom’s actual results,
performance or plans to differ materially from any future results,
performance or plans expressed or implied by such forward-looking
statements. These statements involve risks, uncertainties and other
factors discussed below and detailed from time to time in IFF’s filings
with the Securities and Exchange Commission (the “SEC”) and Frutarom’s
filings with the Israeli Securities Authority.

Risks and uncertainties related to IFF’s proposed acquisition of
Frutarom include, but are not limited to, the inability to obtain
required regulatory approvals for the acquisition, the timing of
obtaining such approvals and the risk that such approvals may result in
the imposition of conditions that could adversely affect the combined
company or the expected benefits of the acquisition, the inability to
obtain the requisite Frutarom shareholder approval of the transaction,
the risk that a condition to closing of the acquisition may not be
satisfied on a timely basis or at all, the failure of the proposed
transaction to close for any other reason, uncertainties as to access to
available financing (including financing for the acquisition or
refinancing of IFF or Frutarom debt) on a timely basis and on reasonable
terms, the impact of IFF’s proposed financing on its liquidity and
flexibility to respond to other business opportunities, whether the
acquisition will have the accretive effect on IFF’s earnings or cash
flows that it expects, the inability to obtain, or delays in obtaining,
cost savings and synergies from the acquisition, costs and difficulties
related to the integration of Frutarom’s businesses and operations with
IFF businesses and operations, unexpected costs, liabilities, charges or
expenses resulting from the acquisition, adverse effects on IFF’s stock
price resulting from the acquisition, the inability to retain key
personnel, and potential adverse reactions, changes to business
relationships or competitive responses resulting from the acquisition.

In addition to the factors set forth above, other factors that may
affect IFF’s plans, results or stock price are set forth in IFF’s Annual
Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports
on Form 8-K. Other factors that may affect Frutarom’s plans, results or
stock price are set forth in Frutarom’s filings with the Israeli
Securities Authority.

Many of these factors are beyond IFF’s and Frutarom’s control and IFF
and Frutarom caution investors that any forward-looking statements made
by IFF or Frutarom are not guarantees of future performance. IFF and
Frutarom disclaim any obligation to update any such factors or to
announce publicly the results of any revisions to any of the
forward-looking statements to reflect future events or developments.

Important Additional Information and Where to Find It

This communication does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of any
vote or approval, nor shall there be any sale of securities in any
jurisdiction in which such offer, solicitation or sale would be unlawful
prior to registration or qualification under the securities laws of any
such jurisdiction. IFF will file with the SEC a registration statement
on Form S-4 that will include a proxy statement of Frutarom that also
constitutes a prospectus of IFF. INVESTORS AND SECURITY HOLDERS OF
FRUTAROM ARE URGED TO READ THE DEFINITIVE PROXY STATEMENT/PROSPECTUS AND
OTHER DOCUMENTS THAT WILL BE FILED WITH THE SEC CAREFULLY AND IN THEIR
ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION. Investors and security holders will be able to obtain free
copies of the registration statement (when available) and other
documents filed with the SEC by the parties through the website
maintained by the SEC at http://www.sec.gov.
Copies of the documents filed with the SEC by IFF will be available free
of charge on IFF’s internet website at ir.iff.com.

NEW YORK --(BUSINESS WIRE)--Oct. 15, 2018-- Regulatory News : International Flavors & Fragrances Inc. (NYSE:IFF) (Euronext Paris: IFF) (TASE: IFF), a leading innovator of scent, taste, and nutrition, announced that it will release its third quarter 2018 earnings results following the market close